TaxTMI 
TaxTMI 
2017 (4) TMI 570
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....red on behalf of assessee and Shri Supriya Biswas, Ld. Departmental Representative represented on behalf of Revenue. 2. Only effective issue raised by assessee in this appeal is that Ld. CIT(A) erred in confirming the order of Assessing Officer by determining the profit of the assessee @ 8% of the gross receipts which is highly excessive and unreasonable. 3. Briefly stated facts are that assessee is a partnership firm and engaged in the business of civil contract. In the year under consideration, assessee has shown contract of gross receipts for Rs. 11,28,70,918/- from the civil contract activity. At the time of assessment, assessee failed to furnish necessary details in support of its expenses claimed in its income tax return. Accord....
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....erial supplied by the contractee department and royalty. No further reduction is required to be made from the gross receipts before the application of net profit rate. The only mistake which is there in the action of the AO is regarding addition of Rs. 60,653/- on account of interest on FDRs which was not required to be made separately in view of decision of the jurisdictional High Court in the case of M/s Shyam Bihari Vs. CIT (supra). Therefore, the action of the AO is upheld except that on separate addition of FDR interest of Rs. 60,653/- is required to be made." Being aggrieved by this order of Ld. CIT(A) assessee is in second appeal before us on the following grounds:- "1. For that, rejection of books of account and estimate....
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....s available on record. From the aforesaid discussion, we find the AO has estimated the profit @ 8% after rejecting the books of accounts of the assessee under section 145(3) of the Act which was subsequently confirmed by the ld.CIT(A). Now the question before us arises for adjudication is as to whether the action of the ld. CIT(A) is correct for working out the income @ 8% of the gross receipt. From the facts of the case, we find that the nature of the work of the assessee has not been doubted and in the similar facts and circumstances various Hon'ble courts have held that a reasonable percentage of profit can be worked out which are cited below. "1. In the case of M/s Triveni Enterprise, Hyderabad Vs the Income-tax Officer Wd 6(1)....
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....s. Assessee failed to furnish necessary evidence for purchase and other expenses. Purchase & expenses not confirmed on an enquiry conducted by the AO u/s. 133(6). Ld. CIT(A) confirmed the order of the Assessing Officer. Tribunal relied on the decision of Hon'ble Orissa High Court decision in the case of CIT Vs Nandaram Hunda Ram (1976) 103 ITR 433, wherein it is held that "if the assessee failed to produce acceptable accounts revenue would be on the decision of Royal medial Hall vs. CIT (1962) 46 ITR 748 (AP) wherein it is held that "estimate of income on the basis of materials available and the past assessment record was held proper" and Tribunal directed the Assessing Officer to recomputed the income by applying 6% of net profit on gross ....